USD/ZAR: Technical Charts And Sentiment Remain Challenging
Date
4/24/2023 2:16:36 PM
(MENAFN- Daily Forex) The usd/zar is near the 18.12100 mark as of this writing with rather quick changes occurring.
Speculators of the currency pair should keep in mind this coming Thursday and next Monday are major holidays in South Africa, which could inspire more trading today and tomorrow if financial institutions are keen to place positions before the long weekend. However, it is likely financial houses will remain rather suspicious of the price action in the USD/ZAR, and may in fact wait for the holiday to end before they take positions if they are not forced to early this week.Lack of Recent Correlation to Broad Forex Results for the USD/ZAR While many other major currency pairs have shown weakness against the USD in recent trading the past week, producing a slightly cautious tone, the USD/ZAR has been able to fight off of highs produced two weeks ago when a rate of nearly 18.53350 was seen momentarily. The reason for this lack of correlation to the broad forex market may be because of unknown large government transactions and corporate activity. The USD/ZAR did hit a low last Thursday that went below the 18.00000 ratios briefly, but since then it has incrementally reversed and moved higher. Rolling blackouts in South Africa continue to be a large problem for businesses in South Africa and certainly are affecting economic production . The lack of clarity regarding a solution to the energy problems in South Africa is not going away soon, and in fact, appears to be getting worse as the level of 'load shedding' has actually increased in recent weeks and is causing widespread anger. Frustration via the business community of South Africa may continue to create a rather durable level of support for the USD/ZAR and limit its ability to sell off significantly. Important U.S Data is Coming this Week and could Factor into the USD/ZAR Important consumer sentiment, growth, and inflation statistics will come from the U.S. starting Tuesday and conclude this Friday. If the CB Consumer Confidence numbers are better than expected tomorrow, this could spur some buying of the USD/ZAR.
On Wednesday of last week, the USD/ZAR was trading near the 18.33000 mark and its ability to trade lower the past couple of days and remain below its recent higher price range is interesting.
However, the movement lower by the currency pair is rather suspicious.
Technical traders may feel comfortable believing a trend lower is developing in the USD/ZAR that can hold, but speculators who also rely upon behavioral sentiment have reasons to be skeptical. The pursuit of buying positions of the USD/ZAR is certainly a wager if based upon perceived support levels, but a belief the currency pair can and will resume some upwards momentum which will come within sight of highs seen last week doesn't feel so farfetched . Trading volumes may be unpredictable because of the approaching holidays in South Africa, thus strict risk management is essential to guard against spikes.
USD/ZAR Short-Term Outlook: Current resistance : 18.14100 Current Support: 18.09500 High Target: 18.20200 Low Target: 18.03600Ready to trade our forex daily analysis and predictions ? Here are the best forex brokers to choose from.
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